Last Year's Loans Off To a Bad Start.(industry statistics)(Brief Article)(Statistical Data Included)

Among both prime and subprime credit quality loans, those originated in 2000 are off to a poor start compared to other recent vintages.

What accounts for the class of 2000's bad reputation?

Among conforming conventional loans, loans originated last year had the highest serious delinquency rate after nine months of any year since the early 1990s, according to the Mortgage Information Corporation.

While only .21% of loans originated last year were 60 days or more late after nine months of seasoning, that's nearly twice the serious delinquency rate from 1999.

Rising interest rates were part of the problem. When the 1998 refinancing boom tapered off, loan originators were left catering to more marginal borrowers in order to keep up origination volume, industry experts say.

The same trend held true on the subprime side of the business. The MIC reports that B&C loans originated in 2000 were under-performing the 1999 vintage by over 25%.

MIC found that 1.21% of B&C loans were seriously delinquent after nine months, 25 basis points higher than the 1999 vintage at that ...